JOHANNESBURG (miningweekly.com) - Remote power generation specialist Zenith Energy's wholly-owned subsidiary Zenith Pacific has executed a power purchase agreement (PPA) to build, own and operate a 62 MW power station for gold miner Newmont's Tanami mine, in the Northern Territory.
The PPA will come into force upon the satisfaction of Newmont's conditions precedent and will have a supply start date of the first quarter of 2019, as well as an initial ten-year term with Newmont having an option to extend for a further ten years.
The execution of the agreement follows the announcement by Zenith in December that it had been selected as preferred bidder to meet the power needs for the remote gold mine, 520 km north-west of Alice Springs in the Tanami desert.
Under the terms of the PPA, Zenith said that it would build, own and operate a 62 MW power station, comprising 52 MW gas-fired and about 10 MW of diesel back-up power generation, to reliably and efficiently service the power needs of the mine.
The power station would also incorporate natural gas generators, which would provide Tanami with cost effective and clean gas-fueled power generation into the future.
Upon completion, the proposed PPA would positively impact ASX-listed Zenith's 2019 financial year earnings and would have a materially positive impact in the following financial year.
"We are extremely pleased to have signed this PPA with Newmont and believe that signing this agreement has further demonstrated Zenith Energy's ability to deliver innovative, reliable, highly efficient and cost-effective power generation solutions to support the diverse needs of its resources clients in remote locations," Zenith Energy MG Hamish Moffat enthused on Wednesday.
The company further looks forward to working with the Newmont team to deliver a clean power supply solution to Tanami.